China’s Stocks Rise to Six-Week High as Technology Shares ClimbBloomberg News
China’s stocks rose, sending the benchmark index to its highest level in six weeks, as technology companies rallied and state media said the government will raise railway spending.
Wasu Media Holding Co. jumped by the 10 percent daily limit after selling a stake to Alibaba Group Holding Ltd. Chairman Jack Ma and fellow billionaire Shi Yuzhu. Sanan Optoelectronics Co. rose 3.4 percent to lead a gauge of technology shares higher, while Tencent Holdings Ltd. added 2.8 percent in Hong Kong. China Railway Group Ltd. climbed 1.6 percent.
The Shanghai Composite Index added 0.3 percent to 2,105.24 at the close. The gauge has rebounded 5.6 percent since March 20 as the government eased funding restrictions for financial companies and outlined a package of measures to support growth last week, including railway spending and tax relief. March trade figures are due tomorrow after manufacturing indexes pointed to economic weakness.
“The market’s expectations about stabilizing growth through infrastructure construction are building up,” said Wu Kan, a money manager at Dragon Life Insurance Co. in Shanghai, which oversees about $3.3 billion. “Technological stocks will get some relief after falling over the past weeks.”
The CSI 300 Index rose 0.1 percent to 2,238.62. The Hang Seng China Enterprises Index gained 0.6 percent in Hong Kong. The Hang Seng China gauge has rebounded 13 percent since entering a bear market on March 20, sending its index of relative strength to the highest level since January 2013.
Wasu Media rallied to the highest since Oct. 15 as shares resumed trading for the first time since Feb. 24. The company said the investment will help it accelerate expansion in new media and big-data services, fund purchases of cable TV networks and cut debts.
A gauge tracking technology companies climbed 1 percent, paring its annual loss to 4 percent. Sanan Optoelectronics advanced to its highest level since Feb. 19. DHC Software Co. added 2.9 percent. Tencent, Asia’s largest Internet company, extended yesterday’s 1.6 percent advance after a 21 percent tumble from its March 6 record sent the shares to a two-month low.
China Railway rose for a second day in Hong Kong. In Shanghai, CSR Corp. advanced 1.3 percent to its highest level in three months.
The government raised its railway fixed-asset investment target for this year to 720 billion yuan ($116.2 billion), higher than the 700 billion yuan target it set at the beginning of the year, the People’s Daily reported, citing Sheng Guangzu, general manager of China Railway Corp.
Premier Li Keqiang is under pressure to address weakening economic growth amid concern the nation will miss its 7.5 percent growth target this year.
A Purchasing Managers’ Index fell to 48 in March, the lowest reading since July, from 48.5 in February, HSBC Holdings Plc and Markit Economics said April 1. Data last month showed fixed-asset investment rose at the slowest January-February pace since 2001, industrial production trailed estimates and exports fell by the most since 2009.
The government is able to loosen monetary policy “moderately in some areas for a while,” such as by cutting the reserve requirement ratio, Zhang Monan, a researcher at the China Center for International Economic Exchanges, wrote in an article in the China Securities Journal.
An index of financial companies slid 0.6 percent today after jumping 3 percent yesterday. Industrial Bank Co. fell 0.6 percent after surging 8 percent yesterday. Citic Securities Co. lost 0.7 percent.
The Shanghai Composite is valued at 7.7 times 12-month projected earnings, compared with the five-year average multiple of 12, according to data compiled by Bloomberg. Trading volumes in the index were 4.8 percent below the 30-day average.
— With assistance by Shidong Zhang